West San Jose
Urban Villages Market Study
Community and Economic Development Committee
August 28, 2023 – Item (d)4
Presenters:
Jose Ruano, Supervising Planner, Planning Division, Department of Planning, Building, and Code Enforcement (PBCE)
Eugene Lau, Planner II, Planning Division, PBCE
Context – Timeline
2019
2021
2022
2023
“2019 Cost of Development Study” identified South De Anza, Paseo De Saratoga, Saratoga Ave, South Bascom Ave (South) as urban villages with near-term potential for market rate development – 11/5/2019 As part of the Four-Year Review of the General Plan Hearing process the City Council directed staff to return to Council through the budget process with a proposed resource allocation dedicated to the creation of priority urban village plans that have the potential to unlock near-term housing opportunities based on market demand – 11/30/2021 “2022 Cost of Development Study” reaffirmed West San Jose as a region with highest potential for near term development – 11/1/2022
Presenting analysis and staff recommendation at Community Economic Development Committee following selection process – 8/28/2023
Context - Boundary and Land Area
De Anza Blvd UV
• 67.23 Acres
• 84 Parcels
• 84 Addresses
Paseo De Saratoga UV
• 141.31 Acres
• 77 Parcels
• 77 Addresses
S. Bascom Av (South) UV
• 92.21 Acres
• 167 Parcels
• 355 Addresses
Saratoga Ave UV
• 112.49 Acres
• 147 Parcels
• 149 Addresses
South De Anza Blvd UV
• 67.23 Acres
• 84 Parcels
• 84 Addresses
Paseo De Saratoga UV
• 141.31 Acres
• 77 Parcels
• 77 Addresses
S. Bascom Av (South) UV
• 92.21 Acres
• 167 Parcels
• 355 Addresses
Saratoga Ave UV
• 112.49 Acres
• 147 Parcels
• 149 Addresses
Growth Areas 3
Context - Boundary and Land Area
South De Anza Blvd
• 133 Acres
• 357 Parcels
• 389 Addresses Saratoga (Combined)
• 254 Acres
• 224 Parcels
• 226 Addresses
S. Bascom Ave (South)
• 92.21 Acres
• 167 Parcels
• 355 Addresses
4 Up Next – Analysis Breakdown
Existing Conditions Staff Recommendation
Opportunity Sites
Displacement Risk
Market Data
Development Interest
Analysis
Opportunity Sites
• Paseo de Saratoga and Saratoga Ave would be combined
into one UV.
• South De Anza would be expanded to the south.
• Saratoga (combined) has the highest number of
opportunity sites (67) and the highest amount that are
“more likely to be developed” (37).
Key-Takeaways
Includes:
• Above .5 acres
• Built before 2000
Excludes:
• Existing Residential
• School
• Historic Resource
• Affordable Housing
• Public Utilities/ Building
• Entitled Projects
Likely to be Developed:
Land Value/Improvement Value
(Accessor Data)
Considered:
Small Business Displacement
6 South De Anza
237 Active Businesses
72 Small Businesses
23 Small Businesses in
Opportunity Sites likely to be
developed
Opportunity Sites –South De Anza
Opportunity Site, 1 ac or Larger
Opportunity Site, .5ac – 1ac
Most Likely to Develop
Considered Small Business
Small Business does not include chain
retail, offices, department stores
7 38 Opportunity Sites
1AC+ Opportunity Sites – 13
/ 9 More Likely to be
Developed
.5 - 1AC Opportunity Sites –25
/ 16 More Likely to be
Developed
Saratoga (Combined)
591 Active Businesses
54 Small Businesses
25 Small Businesses in
Opportunity Sites likely to be
developed
Opportunity Site, 1 ac or Larger
Opportunity Site, .5ac – 1ac
Most Likely to Develop
Opportunity Sites –Saratoga (Combined)
Considered Small Business
8 67 Opportunity Sites
1AC+ Opportunity Sites – 26 /
14 More Likely to be
Developed
.5 - 1AC Opportunity Sites –
41/ 23 More Likely to be
Developed
Small Business does not include chain
retail, offices, department stores
South Bascom Ave
(South)
150 Active Businesses
56 Small Businesses
25 Small Businesses in
Opportunity Sites likely to be
developed
Opportunity Sites –South Bascom Ave (South)
Opportunity Site, 1 ac or Larger
Opportunity Site, .5ac – 1ac
Most Likely to Develop
Considered Small Business
9 23 Opportunity Sites
1AC+ Opportunity Sites – 8/
4 More Likely to be Developed
.5 - 1AC Opportunity Sites – 15
11 More Likely to be
Developed
Small Business does not include chain
retail, offices, department stores
Opportunity Sites –Urban Villages Compared
South De Anza Saratoga (Combined) South Bascom Ave (South) Opportunity Sites 38
Sites Likely to be Developed 25
Small Business Sites in Sites Likely to be
Developed/Total Active Small Businesses 23/72
Opportunity Sites 67
Sites Likely to be Developed 38
Small Business Sites in Sites Likely to be
Developed/Total Active Small Businesses 25/54
Opportunity Sites 23
Sites Likely to be Developed 15
Small Business Sites in Sites Likely to be
Developed/Total Active Small Businesses
25/56
Opportunity Site,
1 ac or Larger
Opportunity Site,
.5ac – 1ac
Improvement
Ratio above 1
Considered Small
Business
Given least risk for small business displacement and higher number of opportunity sites, Saratoga (Combined) is ranked highest followed by South De Anza and then South Bascom Ave (South).
10 Displacement Risk
• South De Anza commands the highest overall incomes
and is least rent burdened and is the least racially
demographically diverse UV.
• South Bascom (South) is the most rent burdened (53%)
followed by Saratoga Combined (43%) and South De Anza
(36%).
• Comparing ACS 5-Year Census Data (2016-2021), South
Bascom (South) is at highest risk for displacement,
followed by Saratoga Combined and South De Anza.
Key-Takeaways
Analysis based on 5-Year
American Community Survey
Block Group Data (2016-
2021) on:
• Median Income
• Rent Burden*
• Housing Tenure
• Racial Makeup
11 Typically, data on income, race and ethnicity, and housing tenure is used to make assessments on residential displacement risk. This is consistent with the analysis used in the Citywide Residential Anti-Displacement Strategy. *Rent burden is a common measure of housing instability meaning that a resident is spending 30% or more of their income on housing.
Market Data
+
Development Interest • South De Anza commands the highest commercial rents over a 10-year period (2013-2023), 12% more than
Saratoga Combined, the next highest.
• Multifamily rents are highest in South De Anza (2013- 2023) for Studios, 1 Bedrooms, 2 Bedrooms, and 3
Bedrooms rents.
• Saratoga Combined takes a slight edge over South Bascom (South) re: rents.
Key-Takeaways
Analysis based on Co-Star Rent Data
and Permit History (Amanda).
12 Market Conditions –Total Commercial/Multifamily Rents According to Co-Star commercial rents data across the 10-year span (2013-2023), South De Anza has reported higher per sq ft rents followed by Saratoga (Combined) and South Bascom South.
$28.00
$35.00
$42.00
$26.00
$32.50
$35.20
$23.30 $27.52
$37.36
$20.00
$25.00
$30.00
$35.00
$40.00
$45.00
2013 2018 2023
Commercial Rents per Sq Ft
S De Anza South Bascom Combined Saratoga
$1,625
$2,050
$2,194
$1,330
$1,725
$2,000
$1,483
$1,953
$2,109
$1,000
$1,200
$1,400
$1,600
$1,800
$2,000
$2,200
$2,400
2013 2018 2023
Example - 1 Bedroom Rent per Sq Ft
S De Anza South Bascom Combined Saratoga
Commercial Rents
Multifamily Rents
Multifamily rents reflect the same trend with commercial rents. All South De Anza apartments, regardless of size, rents at a higher cost than the other urban villages under consideration.
13 Development Interest–Permit History
1090 S De Anza (2019)
Site Development
Permit
4 story, 90 room hotel
(Approved)
1510 S De Anza
(2021)
Site
Development
Permit 132 room
hotel with ground
floor restaurant
and underground
parking
(Approved)
1380 S De Anza (2018)
Conditional Use Permit
103 units for assisted
living and memory care
facility. (Under
Construction)
14 603 Saratoga (2019)
Special Use Permit to
Convert gas station into
9,070 sf commercial retail
building (Approved)
700 Saratoga (2020)
Planned
Development Zoning
and PD Permit 300
residential units and
17,800 sf commercial
on a 20-acre site
(Approved)
5365 Prospect
Rd (2018)
Site
Development
Permit new
40,000-sf
addition to
Westgate West
Shopping Center
(Constructed)
1777 Saratoga
(2020)
Planned
Development
Rezoning 800
residential units,
50,000 sf of retail,
and up to 450,000
sf
office/educational
facility (Approved)
7285 Bark Ln (2019)
Special Use Permit
126 room hotel with an
outdoor area (Approved)
2350 S. Bascom (2021)
Ministerial SB 35 Permit 6
story mixed-use, multifamily
with 123 units & commercial
ground floor
(Under Construction)
2375 S. Bascom
(2021)
Conditional Use
Permit for 83-unit
residential care facility
(Under Construction)
3229 S. Bascom (2021)
Special Use Permit for
4,694 sf building & 6,350 sf
daycare center (Under
Construction)
Market Conditions, Development Interest –Recommendations According to CoStar data across 10 years (2013-2023), South De Anza commands the highest commercial and multifamily rents.
This suggests South De Anza would better support the
financing of new development given today’s constrained
market conditions compared to the other considered UVs.
Though conditions are better in South De Anza, development may still not be financially feasible due to the shifting nature of the market.
Ranking of UVs based on CoStar data &
Permit History:
1. South De Anza
2. Combined Saratoga
3. South Bascom Ave (South)
Affordable Developments are penciling out in South Bascom South, due to GP Amendment IP 5.12 allowing 100% deed restricted residential projects in UVs without approved UV plans and supporting TCAC scores. 15 Initial
Recommendations
1. Combined Saratoga
2. South De Anza
3. South Bascom South
Saratoga
(Combined)
South De Anza South Bascom Ave
(South)
Opportunity Sites 1st 2nd 3rd
Least Residential
Displacement Risk
2nd 1st 3rd
Supportable
Commercial Rents
2nd 1st 3rd
Development
Interest
1st 2nd 3rd
FINAL RANK 1st 2nd 3rd
16 Next Steps • Develop RFP and Consultant Scope and Budget • Onboarding Lead Consultant
• Start Plan Process – Early 2024
17 West San Jose
Urban Villages Market Study
Community and Economic Development Committee
August 28, 2023 – Item (d)4
Presenters:
Jose Ruano, Supervising Planner, Planning Division, Department of Planning, Building, and Code Enforcement (PBCE)
Eugene Lau, Planner II, Planning Division, PBCE